12 U.S.C. § 2075 : US Code - Section 2075: Short- and intermediate-term loans; participation; other financial assistance; terms; conditions; interest; security

    (a) Short- and intermediate-term loans
      Each production credit association, under standards prescribed by
    the board of directors of the Farm Credit Bank of the district, may
    make, guarantee, or participate with other lenders in short- and
    intermediate-term loans and other similar financial assistance to -
    
        (1) bona fide farmers and ranchers and the producers or
      harvesters of aquatic products, for agricultural or aquatic
      purposes and other requirements of such borrowers, including
      financing for basic processing and marketing directly related to
      the operations of the borrower and those of other eligible
      farmers, ranchers, and producers or harvesters of aquatic
      products, except that the operations of the borrower shall supply
      some portion of the total processing or marketing for which
      financing is extended, except that the aggregate of the financing
      provided by any association for basic processing and marketing
      directly related to the operations of farmers, ranchers, and
      producers or harvesters of aquatic products, if the operations of
      the applicant supply less than 20 percent of the total processing
      or marketing for which financing is extended, shall not exceed 15
      percent of the total of all outstanding loans of all associations
      in the district at the end of its preceding fiscal year;
        (2) rural residents for housing financing in rural areas, under
      regulations of the Farm Credit Administration; and
        (3) persons furnishing to farmers and ranchers farm-related
      services directly related to their on-farm operating needs.
    (b) Rural housing
      (1) In general
        Rural housing financed under this part shall be for single-
      family, moderate-priced dwellings and the appurtenances of such
      not inconsistent with the general quality and standards of
      housing existing in, or planned or recommended for, the rural
      area where it is located.
      (2) Limitation
        The aggregate of such housing loans in an association to
      persons other than farmers or ranchers shall not exceed 15
      percent of the outstanding loans at the end of its preceding
      fiscal year except on prior approval by the Farm Credit Bank of
      the district. The aggregate of such housing loans in any farm
      credit district shall not exceed 15 percent of the outstanding
      loans of all associations in the district at the end of the
      preceding fiscal year.
      (3) Rural areas
        For rural housing purposes under this section the term "rural
      areas" shall not be defined to include any city or village having
      a population in excess of 2,500 inhabitants.
      (4) Equipment
        Each association may own and lease, or lease with option to
      purchase, to stockholders of the association equipment needed in
      the operations of the stockholder.
    (c) Interest rates and charges
      (1) In general
        Loans authorized in subsection (a) of this section shall bear
      such rate or rates of interest as are determined under standards
      prescribed by the board of the bank subject to the provisions of
      section 2205 of this title, and shall be made upon such terms,
      conditions, and upon such security, if any, as shall be
      authorized in such standards.
      (2) Setting of rates
        In setting rates and charges, it shall be the objective to
      provide the types of credit needed by eligible borrowers, at the
      lowest reasonable cost on a sound business basis, taking into
      account the cost of money to the association, necessary reserves
      and expenses of the association, and services provided to
      borrowers and members.
      (3) Varying rates
        The loan documents may provide for the interest rate or rates
      to vary from time to time during the repayment period of the loan
      in accordance with the rate or rates currently being charged by
      the association.
      (4) Prior approval
        Such standards may require prior approval of the bank on
      certain classes of loans, and may authorize a continuing
      commitment to a borrower of a line of credit.
    (d) Special district rule
      (1) Provision of credit and technical assistance outside service
        territory
        Notwithstanding any territorial limitation in the charter of a
      production credit association located in a district in which
      there are only two such associations, the Farm Credit
      Administration Board, on request of such association, may permit
      such association to provide credit and technical assistance to
      any borrower who is denied credit by the other production credit
      association in the district if the Board determines that such
      other production credit association in the district is unduly
      restrictive in the application of credit standards.
      (2) Timing of determination
        If the Farm Credit Administration Board approves the extension
      of credit and technical assistance under paragraph (1), the
      association shall approve or deny the application for credit
      within 90 days after receipt of the application from the
      borrower.